Yahoo Finance Erdogan says pound is ‘blowing up’ as Brussels diplomats hit out at ‘gaslighting’ Truss
Turkish president Recep Tayyip Erdogan has claimed the pound is “blowing up” as European diplomats accused Liz Truss of “gaslighting” the British public.
The Turkish leader, who has overseen a 50pc slump in the lira in the past year, said today: “They were bragging about the pound on how valuable they are against this and that, but we got the news today that they blew up.”
Sterling dropped to an all-time low against the dollar at the start of the week after the fiscal package announced by Chancellor Kwasi Kwarteng spooked international investors.
The package has sparked a renewed wave of criticism of Britain from officials in Washington, Brussels and Berlin.
However, the criticism from President Erdogan is perhaps the most embarrassing, given his chequered history when it comes to monetary policy. In the last year, Turkish households have been forced to endure price hikes of almost 80pc because of Mr Erdogan's unorthodox interest rate strategy.
Prime Minister Liz Truss' tax-cutting strategy risks earning her a similar reputation globally. Ms Truss, who has been in Downing Street for three weeks, has dismissed the advice of orthodox economists.
In mainland Europe, officials and politicians accused her of pursuing damaging policies that could cripple other Western economies, aiming jibes through the prism of a Brexit ideology.
A senior diplomatic source told the Telegraph: "With a government that gaslights the British people by selling a tax reduction for high incomes as good for low incomes, Brexit suddenly becomes a lot more understandable; who wouldn’t end up voting against anything sold by Downing Street?
"I think all capitals are rooting for the British government to turn this around quickly so as not to drag down the entire Western economy at this moment."
Guy Verhofstadt, the European parliament's former combative Brexit chief, said the Prime Minister's tax-cutting plan would encourage British voters to rejoin the EU.
The former Belgian prime minister said: "Sometimes you see things clearer from a distance… One day, sooner than we might think, a generation of UK voters and politicians will find their way back to their European destiny!"
Philippe Lamberts, a Green MEP and former Belgian banker, said: "We live in a real world where you need to be able to fund your expenditure or have enough trust to take on debt - and of course the economic situation has been worsened by Brexit. Contrary to the US, the UK is not issuing the global currency."
